nep-hpe New Economics Papers
on History and Philosophy of Economics
Issue of 2008‒10‒28
eighteen papers chosen by
Erik Thomson
University of Chicago

  1. Les paradoxes de la pensée globale (The paradoxes of global thinking) By Hassan Zaoual
  2. Karl Marx and the employment contract: from natural abstraction to formal subsumption By Ernesto Screpanti
  3. Dynamic Economic Game Theory and Asian Free Trade Agreements By James P. Gander
  4. Schumpeter Meeting Keynes: A Policy-Friendly Model of Endogenous Growth and Business Cycles By Giovanni Dosi; Giorgio Fagiolo; Andrea Roventini
  5. Economic Laboratory Experiment on Horn's Rule By Kris De Jaegher; Stephanie Rosenkranz; Utz Weitzel
  6. La notion d'addiction en économie : la théorie du choix rationnel à l'épreuve By Sophie Massin
  7. Consistency in Organization By Schlicht, Ekkehart
  8. "Minsky and Economic Policy 'Keynesianism' All Over Again?" By Eric Tymoigne
  9. A la recherche d'une théorie de la firme pertinente historiquement - Retour sur le cas d'intégration verticale General Motors - Fisher Body (1926) By Michael Dietrich; Jackie Krafft
  10. The Feudal Society in Today's University By Houck, James P.
  11. Destabilizing competition and institutional stabilizersThe contribution of J.M. Keynes By Angel Asensio
  12. The growing evidence of Keynes's methodology advantage and its consequences within the four macro-markets framework By Angel Asensio
  13. Imperialism, Colonialism and Collaboration in the Social Sciences By Ruttan, Vernon W.
  14. Le renouveau des théories du developpement institutions et bonne gouvernance (Renewal of development theories institutions and good governance) By Gwenaëlle OTando
  15. Les Nécessités Marchandes et l’Economie Politique (Commercial needs and the political economy) By Eric Thosun Mandrara
  16. Paul Krugman: Trade and Geography - Economies of Scale, Differentiated Products and Transport Costs By Committee, Nobel Prize
  17. Rethinking basically Economic Assumption on Individual Behavior from Empirical Viewpoints of Evolution and Behavior By Zhao, Liang
  18. Le « développement durable » comme nouveau champ d’accumulation. L’exemple de la réduction de la pollution atmosphérique. (« Sustainable development » as a new accumulation field. The example of atmospheric pollution) By Dimitri Uzunidis

  1. By: Hassan Zaoual (Labrii, ULCO)
    Abstract: Ce texte propose une analyse critique des paradoxes pour lesquels la théorie de l’économie de l’offre qui inspire la globalisation n’a pas de réponse. L’économie de la démesure est autoreproductible. En s’autonomisant et en s’imposant avec force et brutalité aux sociétés contemporaines, elle fait croire qu’elle détient le monopole de la solution de leurs problèmes. La pensée de la globalisation reflète bien cette volonté de puissance. Mais, au fil du temps, l’approche économique du développement dans les pays du Sud et de la mondialisation en général se voit détrônée dans sa fonction de légitimité scientifique en faveur des nouvelles théories des territoires. This text proposes a critical analysis of the paradoxes for which the supply theory that inspires globalization has no answer. The economy of excess is self reproducing. Being more and more autonomous and imposing itself brutally to contemporary societies, it makes believe that it has the monopoly of finding solutions to their problems. The globalization thinking clearly shows this willingness of power. However, with the passing of time, the legitimacy of the economic approach of development in Southern countries and of globalization in general is supplanted by new theories that emphasize the role of territories.
    Keywords: Global thinking, globalization, southern country, autonomous, monopoly
    JEL: B50 O11
    Date: 2008–05
  2. By: Ernesto Screpanti
    Abstract: Marx develops two alternative theories of the employment contract: one treats it as an agreement of commodity exchange, and one as a relational arrangement. In the former theory Marx introduces the notion of 'labour power' as a physical stock of labour capacity. Then he argues that the worker, in exchange for a wage, sells a flow of labour whose use-value consists in the capacity to produce value. He calls this flow "abstract labour" and regards it as a "natural" abstraction, i.e. as an objective good which can be bought in the market as a commodity and used in a factory as a productive force. Exploitation emerges because the value of the flow of labour power is lower than the value-creating capacity of abstract labour. The theory produces various inconveniences, for example: an essentialist theory of value; a notion of value which makes it insensitive to changes in income distribution; and the transformation problem. Its origin, contrary to common opinion, is not just Ricardian. Saint-Simon's propensity to treat labour as a productive force had some influence on Marx's theory of abstract labour as a value-creating power. Hegel's influence is still more important. Marx, in fact, tries to justify the 'natural' character of labour abstraction by resorting to Hegel's doctrine of the 'posited presuppositions', by which a universal and abstract category effectively generates (posits) the empirical phenomena in which it shows itself. On the other hand this way of treating wage labour clearly originates from Hegel's propensity to reduce the employment contract to a contracts for services. In the second theory the employment contract does not consist of an exchange of commodities. Rather it is seen as an institution shaping the conditions for a formal subsumption of labour under capital. This kind of subsumption entails a relation of real subordination of the worker to the capitalist in the production process. Now wage labour is treated as a real abstraction not in a natural sense but only in a historical sense, i.e. as an effectual institution which is typical of capitalist social relations. Exploitation is seen as based on the power relationship by which the capitalists use labour activity in the production process. The theory is not fully elaborated by Marx, but is developed well enough to make it the earliest anticipation of the modern theory of the employment contract as an institution which generates an authority relationship. Furthermore, it is not exposed to criticisms of essentialism and hypostatisation, whilst it is apt to uphold a consistent and enlightening theory of value and exploitation
    JEL: B14 B24 J41
    Date: 2008–10
  3. By: James P. Gander
    Abstract: The purpose of this paper is to use fairly standard game theory elements and apply them to free trade agreements (FTA) made within ASEAN countries and between ASEAN countries and outside countries and the rest of the world (ROW). The applications use some mathematics, but it is not my intent to burden unnecessarily the reader with the mathematics. My intent is to make the applications appeal to the practitioners who are directly or at least indirectly engaged in the process of making FTA’s and who are interested in a theoretical basis for FTA’s. The intent then could be described as being largely pedagogical. The main contribution of the paper is to show the structure and behavior of the backward solution method used in dynamic game theory.
    Keywords: Free Trade Agreements, ASEAN, Backward solution method
    Date: 2008
  4. By: Giovanni Dosi; Giorgio Fagiolo; Andrea Roventini
    Abstract: This paper studies an agent-based model that bridges Keynesian theories of demand generation and Schumpeterian theories of technology-fueled economic growth. We employ the model to investigate the properties of macroeconomic dynamics and the impact of public polices on supply, demand and the "fundamentals" of the economy. We find that the complementarities between factors influencing aggregate demand and drivers of technological change affect both "short-run" fluctuations and long-term growth patterns. From a normative point of view, simulations show a corresponding complementarity between Keynesian and Schumpeterian policies in sustaining long-run growth paths characterized by mild fluctuations and acceptable unemployment levels. The matching or mismatching between innovative exploration of new technologies and the conditions of demand generation appear to suggest the presence of two distinct "regimes" of growth (or absence thereof) characterized by different short-run fluctuations and unemployment levels.
    Keywords: Endogenous Growth; Business Cycles; Growth Policies; Business Cycle Policies; Evolutionary Economics; Agent-Based Computational Economics; Post-Walrasian Economics; Empirical Validation; Monte-Carlo Simulations.
    JEL: E32 E6 O3 O4
    Date: 2008–10–23
  5. By: Kris De Jaegher; Stephanie Rosenkranz; Utz Weitzel
    Abstract: This paper develops a framework for empirically testing several alternative game-theoretic rationales for Horn’s rule. It then presents an economic laboratory experiment where these rationales are empirically tested. Subjects seem to coordinate on Horn’s rule where efficiency acts as a focal point. Nevertheless, a weak interpretation of the evolutionary argument is not rejected: prior play does have an effect on future play. This suggests a hierarchy of effects, where the focal point effect dominates the evolutionary effect, with the latter being more pronounced in cheap talk situations.
    Keywords: Horn’s Rule, Signalling Theory, Pragmatics, Economic Laboratory
    JEL: C72 C92
    Date: 2008–10
  6. By: Sophie Massin (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I)
    Abstract: L'objectif de cet article est d'analyser la littérature économique qui s'est développée au cours des trente dernières années dans le domaine de l'addiction et de s'interroger sur ses rapports avec la théorie du choix rational (TCR). Nous montrons que l'application de TCR aux comportements addictifs est apparue au coeur d'une réciprocité d'enjeux, de promotion de ce cadre théorique et d'explication de ces comportements a priori irrationnels. Celle-ci a permis de mettre en lumière l'influence majeure de déterminants économiques comme les prix, jusqu'alors exclu de l'analyse. Les développements récents de la théorie économique de l'addiction, grâce à l'économie comportementale notamment, conduisent cependant à opérer une distinction entre préférences révélées et préférences normatives qui mettent à mal le recours à la TCR dans une perspective normative.
    Keywords: Addiction, choix rationnel, formation d'habitude, choix intertemporels, préférences révélées.
    Date: 2008–09
  7. By: Schlicht, Ekkehart
    Abstract: Internal organization relies heavily on psychological consistency requirements. This perspective has been emphasized in modern compensation theory, but has not been extended to organization theory. The idea is developed by starting from Williamson's discussion of idiosyncratic exchange. The perspective sheds new light on several topics in the theory of the firm, like the boundaries of the firm (“Williamson's puzzle”), the importance of fairness concerns within firms, the attenuation of incentives, or the role of routines. It implies a “perceptional” theory of the firm that is “realistic” in the sense advocated by Coase (1937).
    Keywords: theory of the firm; hierarchy; evolutionary theory of the firm; perceptional theory of the firm; consistency; small numbers; centralization paradox; Williamson's puzzle; compensation; boundaries of the firm; fairness; small numbers; idiosyncratic exchange; entitlements; obligations; routines; framing
    JEL: B52 D02 L2
    Date: 2008–10–20
  8. By: Eric Tymoigne
    Abstract: Recently, national newspapers all over the world have suggested that we should reread John Maynard Keynes, and that Hyman P. Minsky provides a valuable framework for understanding the world in which we live. While rereading Keynes and discovering Minsky are noble goals, one should also remember the mistakes that were made in the past. The mainstream interpretation and implementation of Keynes's ideas have been very different from what Keynes proposed, and they have been reduced to simple "fiscal activism." This led to the 1950s and 1960s "Keynesian" era, during which fine-tuning was supposed to be a straightforward way to fix economic problems. We know today that this is not the case: just playing around with taxes and government expenditures will not do. On the contrary, problems may worsen. If one wants to get serious about Keynes and Minsky, one should understand that the theoretical and policy implications are far-reaching. This paper compares and contrasts Minsky's views of the capitalist system to the tenets of the New Consensus, and argues that there never has been any true Keynesian revolution. This is illustrated by studying the Roosevelt and Kennedy/Johnson eras, as well as Keynes's reaction to the former and Minsky's critique of the latter. Overall, it is argued that the theoretical framework and policy prescriptions of Irving Fisher, not Keynes, have been much more consistent with past and current government policies.
    Date: 2008–10
  9. By: Michael Dietrich (Université de Sheffield - University of Sheffield); Jackie Krafft (GREDEG - Groupe de recherche en Droit Economie Gestion - Université de Nice Sophia-Antipolis)
    Abstract: L’objet de cet article est, sur la base du cas General Motors Fisher Body, de discuter de la pertinence historique des théories de la firme, et de proposer des pistes permettant de construire des théories pertinentes historiquement. Nous considérons l’ouverture de toutes les archives historiques concernant cette intégration verticale comme une opportunité de redécouvrir ce cas, et de réfléchir sur ce que doit être une théorie de la firme pertinente historiquement.
    Date: 2008
  10. By: Houck, James P.
    Abstract: Few institutions puzzle outsiders as much as the modern university. Even insiders may not grasp the primal essence of its life and behavior. The sheer size and diversity of many universities defeats orderly consideration. We adopt crude simplifications or, worse, numbing obfuscation. This is entirely unnecessary. The core of university life can be illuminated clearly through the prism of a rich and beguiling metaphor. This metaphor requires only that we see today's university as a thinly disguised feudal society such as existed in Europe during the 11th or 12th century A.D. In this medieval context, many otherwise baffling modern mysteries in academe become transparent.
    Keywords: Teaching/Communication/Extension/Profession,
    Date: 2007–09–17
  11. By: Angel Asensio (CEPN - Centre d'économie de l'Université de Paris Nord - CNRS : UMR7115 - Université Paris-Nord - Paris XIII)
    Abstract: Orthodox economics rests on the belief that if markets were fully competitive, there would be general efficiency. The current financial malfunctions, accordingly, would not result from free competition, but rather from insufficient competition. This statement is strong, for it rests on a sophisticated conceptual framework within which there is no dysfunction when perfect competition prevails. But it is also strongly unrealistic, for it rejects public interventions even when markets obviously lost there bearings in the storm. In fact much of those who referred to the orthodox approach before the financial crisis, are now, inconsistently, claiming for public interventions. This short paper argues that there is a consistent way of thinking about necessary public interventions. Indeed, John Maynard Keynes focus on fundamental uncertainty consequences questioned the supposed virtues of competition and offered the most elaborated alternative as for thinking about the current turnmoils and designing the necessary stabilizers.
    Keywords: Equilibrium, competition, stability, institutional stabilizers
    Date: 2008–10–20
  12. By: Angel Asensio (CEPN - Centre d'économie de l'Université de Paris Nord - CNRS : UMR7115 - Université Paris-Nord - Paris XIII)
    Abstract: Recent developments in econometrics and economic theory attest the growing evidence of strong uncertainty. The paper argues that these developments both question seriously the methodological foundations of the mainstream macroeconomics and support Keynes’s powerful concepts and theory. It emphasizes how replacing ‘risk’ with strong uncertainty suffices to transform the standard four-macro-markets system into a shifting demand-driven system, with the result that price rigidity is not to be considered the cause of the effective demand leadership (although, as Keynes pointed out, some rigidity is required to give us some stability in a monetary economy). As it is not based on a restrictive definition of uncertainty, Keynes’s theory is more realistic than the mainstream. It is also more general, for the equilibrium level of employment depends on the views about the future, instead of having a unique ‘natural’ anchor.
    Keywords: General equilibrium, Uncertainty, Post-Keynesian
    Date: 2008–06
  13. By: Ruttan, Vernon W.
    Abstract: Prior to the middle of the twentieth century the margins that have demarcated the subject matter of the several social sciences had been relatively stable since the latter decades of the nineteenth century. Since mid-century, however, a number of intellectual and institutional developments have conspired to call into question traditional disciplinary boundaries. In this paper I address the role of disciplinary imperialism, colonialism and collaboration in advancing social science knowledge about development processes and in the design of development policy and institutions. I conclude the paper with several case studies of collaboration across disciplines that have advanced knowledge and practice in the field of development.
    Keywords: International Development,
    Date: 2008–02–23
  14. By: Gwenaëlle OTando (Lab rii)
    Abstract: Des modèles de décollage économique aux politiques d’ajustement structurel, les préoccupations de l’économie de développement restent vivaces. Le concept de « bonne gouvernance » renouvelle en profondeur le débat sur le développement et la richesse des nations en accordant une place de choix aux institutions. C’est ainsi que ce document se donne pour objectifs de montrer en quoi les institutions et, partant, la « bonne gouvernance », peuvent jouer un rôle important dans le développement. Conscients du fait qu’il ne peut y voir de prospective sans rétrospective, nous allons dans un premier temps, faire le retour sur les théories qui ont marqué l’économie de développement jusqu’aux années 90. Par la suite, nous présenterons, à la lueur des travaux de la nouvelle économie. Models of economic take-off, structural adjustment policies, developmentism, etc., institutions realize the base of development economics. The concept of "good governance" renews the debate on development and the wealth of nations by giving a prominent place to institutions. Thus, this paper gives aims to show how the institutions, and thus the "good governance", can play an important role in socio-economic development. First, we return on such theories that have marked development economics during 40 years after the Second World War. Then, with the help of the new institutional economics, we present the relation between good governance and economic development
    Keywords: development theory, institutions, good governance, economic developpement
    JEL: O43
    Date: 2008–03
  15. By: Eric Thosun Mandrara (labrii, ULCO)
    Abstract: Les nécessités ou « logiques des choses », dont il est ici question, ne sont perceptibles qu'en remontant aux problèmes fondamentaux de l'économie politique. L'on peut saisir, alors, d'un côté une théorie économique classique qui domine la représentation, et de l'autre la réalité régie par la finance et le productivisme. Sur la base de la monnaie fiduciaire, la création monétaire devient incontrôlable. Les entreprises rivalisent d'efforts et d'ingéniosités pour capter, ces flux monétaires, et la société toute entière est soumise au « travailler plus pour gagner plus » pour espérer atteindre la norme de consommation qui évolue constamment. The needs or the “logics of the things” are perceptible while going back to the fundamental problems of political economy. Thus, we can sketch on the one hand the classical economics which dominates the representation, and on the other hand the reality governed by finance and productivism. On the basis of fiduciary currency, monetary creation becomes uncontrolable. Enterprises provide efforts and develop clever means to capture, these monetary flows, and the whole society is subjected to “working more to gain more” to hope reaching the standard of consumption which moves constantly.
    Keywords: Commercial needs, political economy, classical economy, productivisim
    JEL: Z19 B12
    Date: 2008–06
  16. By: Committee, Nobel Prize (Nobel Prize Committee)
    Abstract: Scientific Background, The Nobel Prize in Economic Sciences 2008. Over the centuries, international trade and the location of economic activity have been at the forefront of economic thought. Even today, free trade, globalization, and urbanization remain as commonplace topics in the popular debate as well as in scholarly analyses. Traditionally, trade theory and economic geography evolved as separate subfields of economics. More recently, however, they have converged become more and more united through new theoretical insights, which emphasize that the same basic forces simultaneously determine specialization across countries for a given international distribution of factors of production (trade theory) and the long-run location of those factors across countries (economic geography).
    Keywords: Trade; Geography;
    JEL: F10
    Date: 2008–10–13
  17. By: Zhao, Liang
    Abstract: Building on the predecessors' thoughts and modern researches from empirical disciplines, and with thinking over the behavior assumption usually held and used by mainstream economics, the paper generalizes three basic assumptions and one explanatory framework on human individual behavior and its process, and stresses hierarchical characteristics in preferences, heterogeneity between learning capacity and learning and, human dealing with and reducing uncertainty from environments in the process of natural evolution, and rethinks the questions of individual rationality, acquirement of behavior mode, intellectual history on "knowledge" in the level of experientialism. The purpose is that along the path of "falsifying a theory" and with the help of empirical results, the paper trys to propose behavioral presuppositions and thinking framework, so that enhancing the effectiveness of economic theory on explaining individual behavior in real situations, and in the end advancing transdisciplinary researches between the empirical and social sciences.
    Keywords: assumption; explanatory framework; individual behavior; hierarchical preference; learning capacity; knowledge; evolutionary process; empirical substrate; transdiscipline
    JEL: B21 B31 A12 D8 B59 Y80 D01
    Date: 2008–10–15
  18. By: Dimitri Uzunidis (Labrii, ULCO)
    Abstract: Dans cet article, nous nous intéressons à l’émergence du « développement durable » comme champ d’accumulation et d’innovations sur lequel prendra, peut-être, appui l’activité économique pour les décennies à venir. Dans un premier temps, nous explorons les rapports du « développement durable » avec la théorie économique. Celleci a toujours une référence : le développement industriel. Puis, c’est dans un contexte de crise économique que les économistes intègrent la contrainte environnementale, puis sociale, dans leurs analyses. Cette contrainte alimente un système techno-économique porteur d’innovations « éco-protectrices » et « éco-réparatrices », mais toujours ancré dans la même logique et dans les mêmes rapports économiques et politiques. Les stratégies d’innovation des grandes entreprises illustrent un double phénomène d’apparence contradictoire (deuxième partie) : d’un côté elles freinent, pour des raisons de coût, la réorientation des relations de système et, d’un autre côté, elles profitent de la contrainte pour investir, pour innover et pour réaliser des profits. Dans un troisième temps, nous explorons le chemin du possible et celui des conditions selon lesquelles le nouveau système techno-économique pourrait émerger et s’affirmer. Nous discutons des thèses de la théorie de la décroissance pour montrer que, historiquement, le changement de paradigme techno-économique (en l’occurrence le passage de l’industrialisme à l’éco-économie) suppose une remise en cause fondamentale des rapports économiques de propriété et d’appropriation. This paper deals with the emergence of « sustainable development » as an accumulation and innovation field, which will perhaps be the basis of economic activity for the next decades. We first explore the relations between « sustainable development » and economic theory. The latter main reference has always been industrial development. Then, it is in a context of economic crisis that economist have integrated the environmental and social constraints in their analysis. This constraint feeds a technoeconomic system bringing « eco-protecting » and « eco-repairing » innovations, but which is always based on the same logic and the same economic and politic relationships. The innovation strategies of big firms illustrate a double contradictory phenomenon (second part): on the one hand, they slow down, for cost reasons, they reorientation of systemic relations and, on the other hand, they take advantage of the constraint to invest, innovate and make profits. In a third part, we explore the possible path and the conditions that would favor the emergence and the affirmation of the new techno-economic system. We discuss the thesis of uneconomic growth to show that, historically, the change of techno-economic (the shift from industrialism to eco-economy) needs a fundamental questioning of economic relations of property and appropriation.
    Keywords: sustainable development, accumulation field, atmospheric pollution,environment
    JEL: Q56
    Date: 2008–04

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